ROME — Valentino’s sales came roaring back to approach pre-pandemic levels in the first half of the year, as wealthy consumers embraced the brand’s renewed focus on its rock stud and V-logo lines.
In the first half of 2021, revenue jumped 64 percent year-on-year, to €574million. Chief executive Jacopo Venturini said in a meeting with reporters at the brand’s headquarters that he was “optimistic” about a return to profitability this year.
Valentino was hit particularly hard by the coronavirus crisis as a brand based in Italy—where lengthy pandemic shutdowns disrupted design and production alike—and as a company that still does a significant share of its business in ready-to-wear apparel and formal footwear, both categories whose recoveries have lagged behind leather goods. Last year, Valentino’s sales fell 27 percent to €882 million ($1.1 billion), and swung to a net loss of €127 million, compared to a €33 million profit in 2019.
Venturini joined Valentino in June 2020 after a knockout stint as executive vice president at Gucci, where his savvy merchandising efforts helped translate Alessandro Michele’s runway concepts into a fast-changing lineup of saleable items.
In his first year at Valentino, Venturini moved to increase the focus in merchandising and communications on the brand’s most recognisable rock stud and V-logo lines.
He also moved to gradually phase out the company’s “Red” sub-brand (a less-expensive, wholesale-driven line) as the brand seeks to reposition itself as “the most established Italian maison de couture.”
“We thought it was very important to have Valentino under one single label,” Venturini said.
Clients in the Middle East, US, and China are driving a rebound this year while sales in Europe continue to suffer.
China’s government announced plans last month to curb “unreasonable incomes” and to adopt policies aimed at growing its middle class. Concerns of higher taxes on the rich sent shares in listed luxury groups LVMH, Kering, and Richemont falling by between 6 and 9 percent in a day.
Venturini brushed off the potential impact of a crackdown on China’s wealthy, saying the brand remains underexposed in the key market.
“This is not something that can worry us a lot,” Venturini said. “The main thing in China for us will be to go where we are not in terms of cities, and to speak more about the brand, and help clients to discover us.”
In addition to staging major brand activations like its “Resignify” exhibition in Shanghai last December, the brand plans to open new stores adding locations in Shenzhen, Guangzhou, and Wuhan during the next two years.
Fundraising and M&A have been heating up in the Italian fashion space, but the company’s shareholders are not currently considering an IPO, Venturini said. Valentino is privately held by Mayhoola, the Qatari investment fund that also owns Balmain and Harrods.